I’ve written before about the unsettled nature of North Carolina law on whether it’s valid to assert a claim for aiding and abetting a breach of fiduciary duty. It doesn’t seem that there is much legal enthusiasm for allowing such a claim, but no Court, including the Business Court and the Court of Appeals, seems
Fourth Circuit Sends Plaintiff To The Boondocks For International Arbitration, But With A Round Trip Ticket
The Fourth Circuit last week affirmed a ruling that an injured plaintiff had to arbitrate his claims against his employers in the Philippines, but ruled that the District Court had improperly dismissed his claims for injunctive relief, in Aggarao v. MOL Ship Management Co.
Aggarao had suffered horrible injuries. They occurred when the ship
Be Careful Before Going Paperless For An In Camera Review
Judges don’t like to do in camera reviews of documents. Part of the reason is the quantity of documents involved. There was an Order from Judge Tennille a couple of years ago in which the Judge chastised the parties for submitting notebooks filled with repetitive paper copies of emails which the Defendant claimed were privileged.
Claims Under The North Carolina Securities Act Are Easier To Make Now
Judge Murphy set some new ground rules for cases brought under the North Carolina Securities Act (the NCSA) last week in Associated Packaging, Inc. v. Jackson Paper Manufacturing Co., 2012 NCBC 13. The Jackson Paper case is an important read for any lawyer bringing or defending an NCSA claim in the Business Court. Sorry
Class Action Certified In North Carolina Against KB Homes
How Much Is That Doggie In The Window? (Not Much, Says The NC Court Of Appeals)
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The North Carolina Court of Appeals ruled last week in Shera v. N.C. State University Veterinary Teaching Hospital that dog owners are not entitled to recover damages for the negligent death of their pet beyond the cost to replace the pet. In other words, a sentimental attachment to a pet does not result in an
Don’t Keep Your Trade Secrets Secret If You Are Pursuing A Trade Secrets Claim In The Business Court
I’ve written before about trade secrets claims being dismissed by the Business Court and the NC Court of Appeals because the trade secrets were too broadly referenced and not describe
d with “sufficient particularity". Two of those cases are Akzo Nobel Coatings Inc. v. Rogers, 2011 NCBC 41; and Washburn v. Yadkin Valley Bank
A Trustee Can’t Tell The Trust He Serves To “Take This Job And Shove It”
It’s not easy to walk away from your fiduciary duties as a trustee, even if you try to resign. That’s the subject of Judge Murphy’s opinion this week in Wortman v. Hutaff, 2012 NCBC 9.
Two of the Defendants, Moyer and Hutaff, were trustees of a trust established by Dan L. Moser. They resigned
Fourth Circuit Denies Attorneys’ Fees To Prevailing Defendant in EEOC Action
The only thing sweeter than winning a civil case against the federal government is to win the case and then be awarded your attorneys’ fees. But the winning defendant in EEOC v. Great Steaks, Inc., decided last week by the Fourth Circuit, will have to resign itself to eating cake without icing, notwithstanding three colorable fee arguments which were shot down by the Court.
The EEOC sued Great Steaks on behalf of several employees who claimed they had been sexually harassed in their work at Great Steaks’ restaurant in Greensboro. Great Steaks won the case after a three day jury trial and moved for its fees under Title VII’s fee-shifting provision, under the Equal Access to Justice Act (the "EAJA") and under 28 U.S.C. § 1927. Judge Beaty of the Middle District of North Carolina denied the fee request and was affirmed by the Fourth Circuit.
Title VII’s Fee-Shifting Provision
Title VII contains a provision allowing the Court in its discretion to award reasonable attorneys’ fees to prevailing parties in actions brought under it. 42 U.S.C. § 2000e-5(k). The statute makes no distinction between the standard for prevailing plaintiffs versus prevailing defendants, but in Christiansburg Garment Co. v. EEOC, 434 U.S. 412 (1978), the Supreme Court established a more stringent standard governing when prevailing defendants may recover as compared to prevailing plaintiffs. The Supreme Court said in Christianburg Garment that a prevailing defendant is entitled to fees only if the trial court:
finds that [the plaintiff’s] claim was frivolous, unreasonable, or groundless, or that the plaintiff continued to litigate after it clearly became so.
Id. at 422. A Title VII plaintiff who prevails, on the other hand, "is ordinarily entitled to attorneys’ fees unless special circumstances militate against such an award."
The reasons for the difference are discussed by the Court on pages 9-10 of the opinion.
A highly significant factor to the Fourth Circuit in its determination that no fees were warranted was that Great Steaks had made a motion for judgment as a matter of law at the close of the EEOC’s evidence at trial, which had been denied. So the case was strong enough to go to the jury. Judge Floyd said that the denial of a Rule 50 motion was a ""particularly strong indicator that the plaintiff’s case is not frivolous,unreasonable, or groundless." He said that "we are hard-pressed to imagine circumstances where the district court could make this determination and nevertheless deem the plaintiff’s case frivolous, unreasonable, or groundless." Op. at 12.
The review was for abuse of discretion, and the appellate court said that Judge Beaty was "in the best position" to make the fee assessment" since he had "managed the litigation and conducted the trial." Op. at 14.
All Great Steaks had to offer in support of its motion was that the EEOC’s case had steadily eroded over time from being a class action on behalf of numerous Great Steaks’ employees to a case involving only one employee who turned out not to be very credible and whose testimony had been deemed "troubling" by the Magistrate Judge who recommended that a summary judgment motion made by Great Steaks be denied. One potential class member had refused to appear for her deposition, and another announced that she was quitting the case at her deposition. This wasn’t enough to establish frivolity or groundlessness, according to the Court
Great Steaks took two more shots at a fee award.
Continue Reading Fourth Circuit Denies Attorneys’ Fees To Prevailing Defendant in EEOC Action
Do Bankers Ever Have Fiduciary Duties To Their Customers?
If a bartender serves a visibly intoxicated customer with even more alcohol and the customer then causes an accident while driving drunk, the bartender can be liable under North Carolina’s Dram Shop Act, N.C. Gen. Stat §18B-120, et seq. But if a banker showers cash on a borrower to fund a deal which goes bad